Tech advancement seen as both friend and foe among security pros

    Dec. 4, 2017
    Capital One survey finds a mixed bag of optimism, challenges for the year ahead

    Source SecurityInfoWatch.com

    (Image courtesy bigstockphoto.com/andreiodo)
    A recent survey conducted by Capital One found a mixed bag of optimism and concerns from dealers and integrators about the year ahead with regards to the impact that rapid technology innovation is having on the industry.
    A recent survey conducted by Capital One found a mixed bag of optimism and concerns from dealers and integrators about the year ahead with regards to the impact that rapid technology innovation is having on the industry.

    According to a survey conducted by Capital One at the recently held Honeywell CONNECT conference, the rapid advancement of technology within the security industry has dealers and integrators both optimistic and concerned about their future prospects in the market.

    Of the 118 dealers, integrators and other industry professionals who were polled in the survey, 38 percent cited interconnected devices as next year’s most impactful technology, compared to 28 percent last year, demonstrating the growing influence the Internet of Things is having across the industry.  As residential market penetration continues to tick up, the growth of “do-it-yourself” technologies that enables consumers to set up and monitor their own security at home is also beginning to build. In fact, 19 percent of those surveyed selected those technologies as potentially having the largest impact—a significant increase from just seven percent who said the same last year.

    “We are seeing rapid change across many segments of the security industry,” John Robuck, Capital One’s managing director of security finance said in a statement. “This transformation is primarily being driven by the growth of new technologies that are revolutionizing the implementation and monitoring of security systems.”  

    While an overwhelming majority of the survey’s respondents were optimistic about the industry’s future with 86 percent indicating that they expect better financial performance due to the impact that newer technologies are having on the market, those expectations were also tempered somewhat by the fact that 43 percent cited decreasing margins as their chief concern for the year ahead. In addition, more than a quarter of respondents (26 percent) said keeping up with the pace of technology will present the biggest challenge for their business over the next 12 months.

    Approximately half of those surveyed (51 percent) said local or regional providers are their primary competitor, compared to 35 percent who said the same last year. Only 12 percent see DIY and self-monitored systems as their top competition.

    “While there is clearly growing interest in this technology, DIY is not necessarily being viewed as major competition at this point,” Robuck added. “Established industry dealers view these products as additive and not comparable with professionally-monitored systems.”

    New lines of credit are projected to remain the most important type of financing for the industry in the next 12 months (as cited by 43 percent of respondents), but notably, 15 percent said leveraged buyouts (an acquisition funded in part by borrowed money) will be the most important type of financing to their business—a 50 percent increase over the previous year.

    “Although new lines of credit continue to be the funding vehicle of choice for security professionals, the growth of leveraged buyouts may reflect an increase in M&A activity, with more executives looking to retire or sell to other companies,” said Robuck.